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Monday, 10 November 2008
Page: 10381

Ms PARKE (4:12 PM) —I welcome the tabling of the report of the inquiry by the House Standing Committee on Infrastructure, Transport, Regional Development and Local Government into coastal shipping policy and regulation. The report’s title, Rebuilding Australia’s coastal shipping industry, is in itself a good summary of my position on the subject, for I believe the industry needs rebuilding. I am strongly of the view that it is in Australia’s interests that a national policy to increase the coastal shipping share of the domestic freight task—and, in particular, to support and increase the role of Australian-flagged coastal shipping—be developed and implemented as soon as practicable.

The inquiry report cites clear evidence that sea freight has lost ground against other modes of domestic freight transport over the last 10 years and that, while the total demand for coastal shipping services has grown, this has been accommodated by cargo shipped under permit, which grew 56.4 per cent between the years 2005-06 and 2006-07, rather than by Australian-flagged vessels. There is no doubt that Australia’s coastal shipping industry has fallen away over the last decade and that this has been to our detriment in a number of significant areas. Chief among these are the deterioration of employment and training opportunities; the increased pressure upon other modes of domestic freight and the resulting social, economic and environmental costs of this pressure; and the negative transport security ramifications of a coastal shipping mix in which the Australian-flagged share of the task is both too small and declining.

I was pleased to make a submission to the inquiry and it was only appropriate that I should do so, as a representative of Fremantle, an electorate which includes the historic and economically vital Fremantle Port. As I noted in my submission, Western Australia is our leading export state when it comes to sea freight, with one-third of national exports by value and one-half by volume. Fremantle Port is the largest and busiest general cargo port in Western Australia. It handles 83 per cent of all seaborne imports and 25 per cent of all seaborne exports by value. The total value of trade through Fremantle Port in the financial year 2006-07 was $24 billion.

In remote parts of Western Australia, coastal shipping is not just the preferred mode of transport; it is the only effective mode of transport. It is for this reason that Seacorp, a coastal shipping line that operates through Fremantle Port, holds a long-term state government contract to provide coastal shipping services to link a range of smaller north-west ports with both Fremantle and Darwin. This shipping service runs on a regular 17-day cycle, sailing from Fremantle via Dampier, Port Hedland, Broome and Wyndham on its way to Darwin. It carries 14 per cent of the total amount of freight by road and sea within the Perth-Darwin corridor. Its newest vessel, the MV Kimberley Rose, has delivered a further 20 per cent cargo capacity and, in addition, contributes to both the national Coastwatch program and the Weather Watch program. The Kimberley Rose is utilised for pilot training, and it carries three maritime trainees on each voyage, one from each of the maritime unions.

The benefits of a strengthened and rejuvenated coastal shipping industry are numerous, but I want to mention a few of them. There are significant environmental benefits to shifting freight from road to sea transport. While shipping meets 24 per cent of Australia’s total freight task, it contributes only four per cent of freight emissions. The inquiry report notes that freight transport accounts for six per cent of the total of Australia’s carbon emissions. This is not insignificant. I support the report’s recommendation that the CSIRO study and report on ship emissions. I share the report’s concern about the effect that an emissions trading scheme would have on the competitive position of Australian-flagged vessels versus permit vessels. An emissions trading scheme is likely to improve the cost-competitive position of shipping vis-a-vis other modes of transport. I would hope that any negative impact on the competitive position of Australian-flagged vessels per se would be ameliorated under the proposed Carbon Pollution Reduction Scheme.

As the member for Fremantle, I acknowledge that the movement of freight through the port of Fremantle, particularly container freight, is in turn sustained by road transport. Truck movements in and out of Fremantle have been an understandable cause of community concern for some time. In this context, I am pleased to say that the Gallop-Carpenter state government made significant progress in moving freight out of Fremantle Port by rail instead of by road. In May this year, the Western Australian Minister for Planning and Infrastructure announced a 1,200 per cent increase in the number of containers moving through Fremantle Port by rail since 2002. This increased transport of containers by rail would otherwise have required an estimated 65,000 annual truck movements through the port. The rail container freight share has now risen to 14.5 per cent of total container freight through Fremantle. I hope this effort to move container freight from road to rail will continue to be supported by the Barnett government.

I also welcome the provision in the 2008-09 budget of $1.3 million for investigation and implementation of network intelligence infrastructure and freight traveller information on Leach Highway between Kewdale and Fremantle. This project will improve the efficiency of freight movements by providing freight vehicles with real-time information to allow them to meet allocated time slots at port.

Another positive outcome of a rejuvenated coastal shipping industry would be the national and transport security benefits inherent in a greater role for Australian-flagged vessels. Many other countries, including the United States, recognise these benefits and set their policy accordingly. Few of them have the coastal security challenge that confronts Australia. As I noted in my submission to the inquiry, the United States has traditionally supported and protected its domestic shipping industry to a much greater degree than Australia. Section 27 of the US Merchant Marine Act 1920, known more commonly as the ‘Jones act’, requires that all water transportation of goods between US ports be on US built, owned, crewed and operated ships. ‘Jones act’ ships constitute a large and service-ready merchant marine and they maintain a pool of well-trained maritime personnel. While this is a degree of regulation that would not be contemplated in Australia—it would not be appropriate for a range of reasons—it remains the case that a return to the intention, spirit and objectives of the Navigation Act, especially where it concerns the granting of permits and special licences, would encourage the rejuvenation of coastal shipping by Australian-flagged vessels. A return to the intended function of cabotage in Australia, with the addition of the appropriate administrative structures, could deliver the dual benefits of supporting coastal shipping in general while also increasing Australia’s latent defence and peacekeeping capabilities. Any increase in coastal shipping by Australian-flagged vessels would certainly provide an increase in the degree of transport security.

Domestic freight in Australia is projected to double in the next 10 to 15 years. It is important that this growing freight task be shared appropriately between the various modes of domestic transport, and in my view this will require a significant growth in the share held by coastal shipping. I endorse the purpose and conduct of the inquiry by the House of Representatives Standing Committee on Infrastructure, Transport, Regional Development and Local Government, and I support the report’s recommendations, particularly the recommendations that go to the review of the Navigation Act and to the creation of the reform implementation group.